The 10-member inter-ministerial committee has been tasked with profiling factories at risk of closure by examining their finances, debts and unpaid wages to workers, according to an October 27 office order of the Ministry of Labor and Employment.

The government has set up a special committee to help struggling ready-made garment (RMG) and non-RMG factories, especially those affected by the recent labor unrest.

The 10-member inter-ministerial committee has been tasked with profiling factories at risk of closure by examining their finances, debts and unpaid wages to workers, according to an Oct. 27 office order of the Ministry of Labor and Employment.

The committee was asked to submit a report to the ministry within seven days outlining possible solutions to the problems faced by these factories.

The committee, led by Arif Ahmed Khan, additional inspector general of the Department of Factories and Establishments Inspection (Dife), also includes representatives from the Finance Department, Bangladesh Army, Industrial Police, Bangladesh Garment Manufacturers and Exporters Association (BGMEA). As factory owners and workers.

Arif Ahmed Khan told TBS that the committee, which has the authority to include experts if necessary, has started its work.

Minister of Labor and Employment AHM Shafiquzzaman told TBS yesterday via WhatsApp from Geneva that the committee will identify obstacles to factories providing service benefits to workers.

“Based on the committee’s recommendations, the government will take necessary measures to help factories overcome the challenges,” he added.

After Hasina’s fall, some property owners fled, factories closed

After the overthrow of the Hasina government on August 5, many factory owners closed their businesses and fled, some were arrested.

The fact that many factories have not yet paid workers’ salaries for August and September has led to unrest among workers in the ready-made clothing industry. Many factories in Ashulia, Savar, Tongi and Gazipur remain closed.

According to BGMEA data as of October 30, 2,107 of 2,119 factories are currently in operation. 12 factories were either temporarily closed or workers were put on leave. Salary payments have not yet been made for September in 21 factories and for August in two factories.

Among the closed factories in Ashulia district where salaries are not paid are Anjuman Designers Ltd, DIPS Apparels Ltd and Generation Next Fashion Ltd. In Savar, there are closed factories such as Shams Styles Ltd, The Civil Engineering Ltd, Kazipur Fashion Ltd and Standard Stitches Ltd.

Additionally, many factories in Jirani, Chandra, Tongi, Bordbazar and Kachukhet areas of Mirpur remained closed as of yesterday.

The situation was much worse last month, with many factories forced to halt operations for several days due to widespread unrest.

Labor Advisor Asif Mahmud Sajib Bhuiyan said last month that unrest and factory closures had resulted in the cancellation of 15% to 20% of export orders.

Square Group CEO Tapan Chowdhury told reporters on October 9 that worker unrest had led to a decline in the company’s orders, with foreign buyers redirecting some orders to other countries.

Asif Ashraf, a member of BGMEA administrative support team, told TBS: “Currently, 99.91% of factories are operational, only around 10 to 12 factories are offline. The aim of the current committee is to determine why some factories are not operating or working. “don’t.”

“The problems are not permanent. We hope that we will come out of this situation soon,” he added.

open challenges

While the challenges in the RMG sector are clear, the extent of labor unrest, delayed wages or risks of closure in the non-RMG sector remains unclear.

Incidents of arson and vandalism have affected both RMG and non-RMG factories in the last two months.

The Gazi Tire factory of the Gazi Group, owned by former Textile and Jute Minister Golam Dastgir Gazi, was subjected to numerous arson and looting incidents in August and September, leading to its complete closure.

Workers working in a clothing factory belonging to Salman F. Rahman’s Beximco Group set fire to the facility on September 11, demanding their unpaid wages.

Federation of Bangladesh Chamber of Commerce and Industry (FBCCI) director Hafizur Rahman told TBS that many companies have approached FBCCI citing financial losses due to factors such as labor unrest and vandalism. They are seeking financial aid from the government and flexibility in repaying bank loans.

He stated that FBCCI forwarded these applications along with recommendations to Bangladesh Bank and Ministry of Commerce for consideration.

However, the FBCCI executive was unable to provide an instant count of companies that had filed applications or the total financial losses reported.

Deputy inspector general of Industrial Police, Muhammad Ashrafuzzaman, who is also a committee member, told TBS: “We do not yet know how many factories are in financial difficulty and unable to pay salaries. We are collecting data at the field level.”

However, he said it is not easy to identify such factories. Because a factory that has a problem today may not have a problem two weeks later. New factories may experience problems.

“The committee has already held two meetings. We also met with two factories (which were in trouble),” Ashrafuzzaman added.

Officials from the Factories and Workplaces Inspection Department told TBS that the committee was operating in strict secrecy due to concerns that factory owners could overwhelm the process when seeking government help.

Business leaders welcomed the move

Welcoming the move, business leaders said it was essential to help struggling factory owners, but the government must also ensure that businessmen do not face undue political harassment or legal challenges.

They also advocated for the inclusion of a representative from Bangladesh Bank in the committee.

Jasim Uddin, vice-chairman of the Bengal Industrial Group, told TBS: “A large number of factories have closed since August 5 for various reasons and many more face potential closure. If the government can identify the difficulties these factories are experiencing and offer financial assistance “Help these factories protect employment, production and exports.”

It also brought up some other problems faced by the country’s industries. Factories are facing serious gas and electricity crises. These disruptions disrupt production and lead to delays in loan repayments, leading to defaults.